So where were we? Ah yes: five conclusions about the potential of private 5G to transform telco operations, and telco fortunes – as told by mobile network operators (MNOs) at RCR Live in London last month (all sessions available on-demand).
The conclusions, if we recall, are: that telecoms, for its own sake, only matters to telecoms (one); that Industry 4.0 is a team sport, and a speculative one at that (two); that 5G is an iterative technology, which has so far been oversold (three); that traditional MNOs retain valuable spectrum assets, especially for off-site mobility and even on-site redundancy (four); and that the SME market is where the war will be won and lost, some years from now (five).
The below provides the supporting quotes for these five conclusions, as taken from RCR Live in London last month, and as trailed on an editorial preamble last week; the responses, as indicated, are from Sandeep Raithatha, in charge of 5G-IoT strategy at Virgin Media O2 (VMO2), Sam Salih, heading 5G and IoT propositions and strategy at BT Business, and Bhushan Patil, chief growth officer for the telco business at system integrator Tech Mahindra.
1 | Private 5G only matters to telecoms (solutions)
Hardly revelatory, but it somehow matters to hear it from MNOs; that 5G is just a piece of a bigger puzzle. Salih explains: “Private networks are one part of the answer, certainly… [But] private networks are not about networks, actually. They are about enabling tangible business outcomes. It has to be a more holistic approach.” He goes on to say that BT Business, like other supply-side prospectors in the Industry 4.0 foothills, knows the sale of private 5G systems hinges on identifying and solving enterprise headaches first.
“You have to ask the enterprise about its ambition with digital transformation, and the Industry 4.0 elements it wants to bring into its operations, and how they are to drive benefits in terms of productivity, efficiency, safety and security. And you then have to work backwards to identify the use cases to start with. Which will inform what the network will look like, and how to use things like MEC, and that whole IT/OT convergence – to give customers a total solution rather than a point product.”
Patil at Tech Mahindra says exactly the same; the argument is that SIs have worked this way forever, as a consequence of their mix-and-match approach to problem solving. He comments: “The G doesn’t matter to enterprises that much. It is just about solving a business problem. And often, the enterprises that have done little reading around the subject, ask, ‘But why can’t I do it with Wi-Fi 6 or LTE?’”
And often, the answer, as BT and VMO2 both acknowledge (see conclusion #3), is that 5G is not needed at all, out of the gates. Tech Mahindra, says Patil, does not even talk about 5G, but rather about a combo-solution presented to customers as an “intelligent network”. “Because, in the end, the network is an enabler, and not a dead-end,” he says. “[And] that is the progress in the market – to bring together all the IoT and Wi-Fi and 5G to deliver a solution.”
2 | Private 5G is a speculative business (partnerships)
The above entry hints at the complex Industry 4.0 puzzle, but rather concludes that networking is a puzzle of its own, typically with the edge and cloud (and MEC) engine(s) attached. Nevertheless, as recent commentaries about MWC and Hannover Messe make clear, digital change is not just about a smarter network; it is about what goes on top. This is implicit in the above-comments from Salih and Patel, but it should be explicit, too.
Salih makes it so: “Partnerships are critical. We will not win in this marketplace without a broad and deep range of partners across the [whole] ecosystem. BT is organised around key verticals, and is bringing expertise from outside telecoms… So, as we develop solutions, they are vertically aligned and appropriate, and our engagement is more consultative and outcome-led.” He mentions a “partner advisory board” with Microsoft, Atos, Ericsson, and PwC.
“The idea is to address big challenges… and produce things [together] that we could not do alone… We are bringing all of them together for customers, as [part of a] single solution… We couldn’t do this on our own.” Patil nods; MNOs have changed enough to be considered good industrial collaborators, even if they are generally ill-equipped to play as master integrators in the equation. “Telcos have developed skills and capabilities,” he says.
“[But] there are too many industries [and] too many use cases… Which is where we can help, because we are set up [to serve] industry verticals… We just need to shake hands, and SIs and MNOs will find a model to work together.” Raithatha at VMO2, also on the panel, picks up the related (eternal / infernal) question about who owns the customer relationship, within this wild Industry 4.0 partnership framework.
Does VMO2 expect to ‘prime’ every time? He responds: “Yes, ideally we would like to prime where we can and lead with the connectivity, and then build up the solution, and managed service and security wrap. But we are open of course. It depends on who is available and who the customer wants to work with. We will flex as needed. That ecosystem play is really important; it is not just one party that will create that complete solution.”
Salih chimes in: “We would love to prime, all the time. But it is not possible. We will work flexibly where it is needed.” It is exactly the same hymn sheet, and it sounds… totally correct and reasonable. He adds: “It is not about whether we prime, but how we achieve the best outcomes… We are not the prime in lots of [global contracts]. We will… prime where we can [and] where it is right – but it may not always be right, and we are comfortable with that.”
In the end, the whole Industry 4.0 discipline is speculative; these developing bands of tech suppliers are prospecting for gold in different industrial landscapes, and realise the one sense os to trust that the spoils will eventually be shared. Is that right? The question goes to Patil, who responds: “Sure. For us, it is more [just] about getting involved, and being part of the solution no matter which role we take.”
3 | Private 5G is not novel transformation (technology)
What is very clear – more clear than anything, perhaps – is that, in the scheme of things, private 5G is not delivering a particularly novel form of transformation, as yet. Most of the time, it is just making things work better, which worked imperfectly before. And lots of the time, it is not even 5G that is delivering these improvements. This is the case with the live deployments VMO2 and BT talked about last month at RCR Live.
In particular, VMO2’s headline-grabbing deployment with British Sugar, across four sites in the Midlands, running indoors and outdoors, is based an LTE-based system in the first instance, geared to provide reliable connectivity, most to workers (carrying smartphones and laptops) – rather than to connect machines for automation and intelligence. “We started with 4G [for connecting workers], and we’ll see how it evolves,” comments Raithatha.
Which has value, of course; British Sugar has coverage for the first time in some areas – “in quite-rural places, [and] indoors and in outdoor campuses where it has its external production and storage”. He adds: ”Other use cases will come through, more around automation and efficiency.” But even the other VMO2 example, a full-5G network on one floor of a hospital for the South London & Maudsley (SLAM) NHS Trust, is mostly just about broadband connectivity
Raithatha says: “We have seen some great value over the last year – firstly to connect workers, allowing clinicians to update information in real time, and remote experts to help field IT engineers with AR; and tracking and monitoring medicines as well. There are multiple solutions that will stack up to deliver that ROI.” But the point is these are not, yet, high-fidelity platforms for novel Industry 4.0 pyrotechnics; the 5G standard is developing, and has a way to go.
For now, deployments are mostly being bankrolled by their broadband-style connectivity and coverage capabilities. Private cellular is not, as yet, an Ethernet-equivalent mobile control network, offering near-total reliability and near-zero latency for rarefied industrial cases – and maybe not ever be, at least as a mass-market service. BT’s live showcase, at Belfast Harbour is a “really good example of a 5G deployment that actually needs 5G”, responds Sailh.
“It is not just enabling more basic connectivity and coverage across a large site, we are also starting to deploy real 5G use cases, like AGVs and automated buses. [It is] a very complex site… [with] a plethora of use cases, deploying phase by phase, each with a clear ROI. And we are seeing the same with other port deployments, too.” But critically – at least so far as we are to gauge progress – Belfast is a picture of the future, and not typical of most deployments.
Salih says: “A lot of customers are much more ready for 4G. That is what the conversation comes back to – the right network for the right use cases, and giving them a path to 5G, as they need it; rather than us saying, ‘Here is a shiny 5G network’, and them saying, ‘But what do I do with it?’ It is a more holistic outcome-based approach.”
4 | Private 5G needs public spectrum (use cases)
Or rather, private enterprise needs public spectrum, too, in some cases – and in many cases, potentially. Which, again, is hardly revelatory, but which is refreshing to hear – and also needs saying, after all these years of MNOs practically being written off as new-age M2M providers. Because there are plenty of high-volume use cases that will not work with patched-together island networks. Remember connected cars? Maybe much higher-volume cases.
But there are more traditional Industry 4.0 cases that will also use public spectrum. British Sugar and SLAM are using VMO2’s licensed national spectrum, in ring-fenced locales; they are not using any of the newly-liberated n77 band, at 3.8-4.2 GHz, which UK regulator Ofcom is supplying directly to enterprises, for dirt-cheap. Raithatha responds: “When we’ve deployed private networks in the UK, we have used our own spectrum.”
He adds: “We will continue to do that – where we can, obviously, with careful planning to avoid conflict or congestion. And we are leveraging our parent companies’ [spectrum; from Telefonica and Liberty Global], as well, and their footprints across Europe and Latin America to see how we can approach multinational opportunities, leveraging our strengths from across the joint venture as well.”
Salih chimes in: “The n77 shared band in the UK doesn’t actually address many of the initial use cases enterprises want… Customers… [often need] wide-area coverage. We are [often] deploying 4G instead of 5G, utilising our [existing] assets and building a pathway to 5G instead. But most of the use cases are around connectivity – whether to connect people, devices or machines. Which is where we see our own spectrum adding most value.”
The discussion at RCR Live got into the important minutiae of private 5G categorisation, noting the difference between dedicated on-premise edge 5G setups, and more integrated (NPI-NPN) hybrid and hosted networks, and suggesting that operator-led deployments of the latter two services using national infrastructure in some capacity will likely serve a swathe of the enterprise market. This will give “the ability to roam… and also to cut costs”.
Raithatha adds: “We mostly see dedicated private networks today. But if you think about IoT, where you want to understand your supply chain across a whole country or region, then bringing together both worlds is probably a good thing to work towards. There’s definitely some value to be able to roam between the two. It is important to have a clear use case and ROI to underpin that type of investment and solution as well.”
Patil also notes how the deployment trend will likely shift, to an extent, away from bespoke edge deployments towards hybrid versions. “As Sam [Salih] said, many use cases will not stay isolated. They will need to move from private to public networks. Most of our engagements are about sites that are independent. [But that will change – which is] where the public network does come into play.”
5 | Private 5G will be defined by SMEs (sales)
Which, with a skip and a jump, gets into the question about how private 5G eventually scales – to transform whole industries, and even economies, and not just single enterprises. The point is raised in London that, at Hannover Messe last month, Volkswagen, the biggest car maker on the planet, took to the stage to say it had so far deployed just four (!) private 5G test networks in four different plants for four different brands (Audi, Porsche, Skoda, Volkswagen), and that, whatever anyone says, the private 5G story is going nowhere very fast; so what to do?
The response from the panel is about focusing on vertical solutions, and abstracting the technology from them. Patil says: “We will make an industry solution. We have chosen four industries, where we will go do business case development with the subject matter expert, and make it technology-agnostic. That is the way I think it is going to scale. You have to show it and replicate the same thing.”
Which sounds like a recipe for ‘blueprints’, which the whole industry loves to talk about. Is that what is needed, or is the reality that Industry 4.0 suppliers have to go mob-handed every time, enterprise-by-enterprise, to make bespoke solutions every time? Salih responds: “It sits somewhere between the two. We are focused on five verticals, which all have a need for private networks, and are all active with digital transformation as well.
“There are analyst reports that say everyone will get a private network at some point, but that is not the case right now. In terms of blueprints, some of those on-premise networks are highly bespoke and complex, deployed in very challenging environments. We have blueprints for how to approach those solutions, and how to take customers on a journey to arrive at a solution, and that is working very well for us.
“But I don’t think an on-prem rinse-and-repeat network will quite work. It will be different with hybrid networks, leveraging the macro network – there are blueprints we can start using [for those], where we know it will be the same every time.” Indeed, there is a temptation to think Industry 4.0 makes it when Volkswagen commercialises and multiplies its scattered private 5G experiments; but these are large-but-limited proof points for a bigger rollout. In other words, how and when is the SME market opened up for private 5G, and who is best positioned to supply it?
Raithatha responds: “There will definitely be an opportunity for us in the SME market – [and] that is where you’ll see [this] scale to millions of deployments. Most operators have great channel-reach already with SMEs. There has been a lot of focus on custom solutions for complex organisations. [The question is] how you make this more repeatable, and easily deployable, with use cases that can be delivered off-the-shelf – [by] leveraging [our] spectrum where we can, and reducing the total cost of ownership.”
He adds: “Those are some of the things we’ve got to tackle. There is quite a lot to do to get in front of SMEs and scale it up.”
